The critical value of Chinese consumers for Australian wool

Transcription

1 The critical value of Chinese consumers for Australian wool Allan Wang Project manager - Senior Analyst, Business Intelligence ABARES Outlook 2014, Canberra, 4-5 th March 2014

2 Our partner - China China is our largest trading partner. For our future development, it is critical to understand the Chinese consumers. The Chinese consumer market is evolving rapidly because of: Income growth Demographic change Behavioural change

3 Rebalancing of the global economy China s share of global GDP was 13% in 2013 and will grow to 17% in China is expected to surpass the Eurozone s share in 2017.

4 As GDP per capita rises, spending changes US, Japan, Western Europe, Australia China

5 China: Unprecedented growth

6 China: rise of the middle income +149 Mn +14 Mn +3 Mn +3 Mn Million -128 Mn China s middle income earners are expected to increase by 163 million people over the next 7 years.

7 China: Rapid ageing population +75 Mn + 87 Million -12 Mn -36 Mn +13 Mn -1 Mn -48 Million China s population is expected to rapidly age over the next 7 years, with an increase of 87 million people in the older population and a decrease in the younger generations.

8 China: Fast changing consumer market The changes underway to China s age and wealth demographics should result in booming middle-age wealth ( affluent ageing ): y/o s in the middle and high income categories will more than double (+36m) y/o s in the middle income category will double (+71m) 60+ y/o s in the middle income category will increase by ~ 250%

9 China is driving expenditure on clothing China s clothing expenditure is expected to grow on average 11% annually until 2020, more than 2.5 times the expected USA growth of 4%. China s clothing expenditure is forecast to surpass the USA in 2019

10 In China, wool production is seen as sustainable 100% 80% 60% 40% Don't Know No Yes 20% 0% 100% Cotton Cotton Blends Source: Nielsen consumer tracker (Jun 2013) 100% Wool Merino Wool Wool Blends Cashmere 80% of Chinese consumers think wool is sustainably produced, close to cotton (the benchmark). Synthetics are seen as the least sustainable. Silk Synthetics Denim

11 Chinese consumers view wool more positively Chinese consumers have the strongest positive environmental assessment for wool.

12 Summary China s economy is moving into a new course. Demographic and income factors are transforming China into a wealthier and more sophisticated market. China continues to drive global expenditure on clothing. Chinese consumers assess wool as being environmentally friendly and sustainable. As China sets for its new odyssey, it will present incredible opportunities for Australian wool, and all other agriculture produce.

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